If I wish to purchase my first home but need help meeting the monthly mortgage and other homeownership expenses, is there a program that will help me?
Yes, it is called the Homeownership Voucher Program.
If I am currently a participant in the Housing Choice Voucher program and receive rental assistance, can I use my voucher to buy a home and receive monthly assistance in meeting homeownership expenses?
Yes, if your local PHA participates in the homeownership voucher program, and you meet income and other eligibility requirements.
If I don’t have a rental voucher what do I do?
You have to apply for a housing choice voucher at the local PHA.
Are there any standards for the home to be purchased under this program?
The home must pass an initial housing quality standards inspection conducted by the PHA and an independent home inspection before the PHA may approve the purchase by the family.
What families are eligible to apply for homeownership vouchers?
Families must meet these requirements:
- First-time homeowner or cooperative member.
- No family member has owned or had ownership interest in their residence for at least three years.
- Except for cooperative members, no member of the family has any ownership interest in any residential property.
- Minimum income requirement. Except in the case of disabled families, the qualified annual income of the adult family members who will own the home must not be less than the Federal minimum hourly wage multiplied by 2,000 hours. For disabled families, the qualified annual income of the adult family members who will own the home must not be less than the monthly Federal Supplemental Security Income (SSI) benefit for an individual living alone multiplied by 12. The PHA may also establish a higher minimum income requirement for either or both types of families. Except in the case of an elderly or disabled family, welfare assistance is not counted in determining whether the family meets the minimum income requirement.
- Employment requirement. Except in the case of elderly and disabled families, one or more adults in the family who will own the home is currently employed on a full-time basis and has been continuously employed on a full-time basis for at least one year before commencement of homeownership assistance.
- Additional PHA eligibility requirements. The family meets any other initial eligibility requirements set by the PHA.
- Homeownership counseling. The family must attend and satisfactorily complete the PHA’s pre-assistance homeownership and housing counseling program.
What are monthly homeownership expenses?
Monthly homeownership expenses include:
1. Mortgage principal and interest,
2. Mortgage insurance premium,
3. Real estate taxes and homeowner insurance,
4. Principal and interest on debt to finance major repairs and replacements for the home, and
5. Principal and interest on debt to finance costs to make the home accessible for a family member with disabilities if the PHA determines it is needed as a reasonable accommodation.
How much financial assistance can PHAs provide in each voucher?
The PHA uses its normal voucher program payment standard schedule to determine the amount of subsidy. The housing assistance payment (HAP) is the lesser of either the payment standard minus the total tenant payment or the family’s monthly homeownership expenses minus the total tenant payment. The PHA may make the HAP payment directly to the family or to the lender.
What is the total monthly tenant payment?
For purposes of calculating the amount of financial assistance to be provided by the PHA, the monthly tenant payment is generally 30% of the family’s adjusted monthly income. For more information about how to determine total tenant payment contact your local PHA.
What do I have to pay each month?
You have to pay at least the total tenant payment (approximately 30% of adjusted monthly income). However, if you purchase a home that has monthly expenses higher than those covered by the total of the financial assistance provided by the PHA together with the tenant payment (30% of income), any additional amount will have to be paid by the family. To keep families from purchasing a home that will result in a payment the family cannot afford, the PHA, may set affordability limits for their program.
Do families have to purchase a home in the jurisdiction where the PHA issued the voucher?
No. Families that are eligible for homeownership assistance may purchase a home outside the initial jurisdiction if the PHA in the new jurisdiction administers the homeownership voucher program and receives new families into the program. However, the family may only use the voucher to purchase a unit in an area where the family is income eligible at admission to the program.
How long can a family receive assistance under this program?
There is no time limit for an elderly household or a disabled family. For all other families, there is a mandatory term limit of 15 years if the initial mortgage incurred to finance purchase of the home has a term that is 20 years or longer, and for all other cases the maximum term of homeownership assistance is 10 years.